The Government announced the adult rate would increase by 2.5pc to £6.08 an hour in October, accepting recommendations from the independent Low Pay Commission.

The youth minimum wage for those aged 18 to 20 is also set to go up by 6p to £4.98 an hour. The new apprenticeship minimum wage will increase by 10p to £2.60 an hour, while the rate for 16 to 17-year olds will go up by 4p, to reach £3.68 an hour.

However, several business groups warned the changes were "misguided" in the current climate as employers struggled to create jobs.

Several big companies, including the major supermarkets, already pay above the minimum wage for most roles, so any increase will affect small firms more.

David Frost, director-general of the British Chambers of Commerce, said the new rates were "the wrong increase, at the wrong time". He said: "With over a million unemployed, the priority has to be getting people back into the job market. Youth unemployment is at a record high and we can't afford to price young people out of work.

Related Articles

It's clear from speaking to businesses that a significant number are having to freeze wages in 2011. These changes will be a barrier to job creation, and ultimately economic recovery."

But Neil Bentley, CBI deputy director-general, said: "This moderate increase strikes the right balance during a period of economic uncertainty. It means workers on the minimum wage will not fall behind the rest of the workforce in terms of pay rises."

Business Secretary Vince Cable said the rises would benefit 890,000 people, claiming it "reflected the current economic uncertainty while at the same time protecting the UK's lowest-paid workers".